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Stay abreast of what’s happening internationally with developments in corporate public affairs. Here is news that you may find useful and interesting:



British Panel Calls for Stricter Antitrust Rules on Tech Giants ND
Adam Satariano, The New York Times, Tuesday 12th March 2019

Britain has this week added its voice to the global backlash against the growing power of technology companies, as a British government report released on Wednesday affirmed that Big Tech is reducing consumer choice and harming innovation. The 150 page report said the country needed stricter rules on acquisitions in the technology industry and stronger oversight to make sure that new rivals cannot be squashed. Jason Furman, a professor of economic policy at Harvard and former economic advisor to President Barack Obama led the group behind the report, and he said that addressing insufficient competition in the tech industry “is one of the most important economic policy questions” in the world today. Democratic presidential candidate Senator Elizabeth Warren last week called for breaking up the largest tech companies, and Senator Amy Klobuchar, another Democrat making a White House bid, has proposed taxes and antitrust laws against the industry. Other countries in Europe have taken stands as well. France has proposed taxes on technology companies, while Germany passed a law against online hate speech.

For the full story click here
Businesses urged to ‘do more’ to win public contracts ND
BBC News, Monday 11th March 2019

The UK government is set to announce that businesses looking to secure public sector contracts will need to do more to help improve society, with issues like modern slavery and climate change top of the list to tackle. The UK spends £49bn with outside organisations every year, and will also try to award more contracts to small firms. When drawing up public contracts, the government will now be looking at firms that employ people from diverse backgrounds, how companies reduce modern slavery and cyber security risks in their supply chains, businesses focused on environmental sustainability and companies that boost employees’ employability potential through staff training. "By making sure that these social values are reflected not just across the government, but through all the companies we work with, we will take a major step towards our goal of creating an economy that works for everyone," Cabinet Office minister David Lidington will say. Charity Anti-Slavery International has welcomed the UK's efforts to stamp out modern slavery, but it wants to see the government do even more. "At the moment big businesses are made to report slavery in the supply chain, but there are no penalties for either failing to submit the statement, or whether you report that it exists," Jakub Sobik, a spokesman for Anti-Slavery International told the BBC.

To read the full story click here
Goldman Sachs tells its bankers to loosen their neckties ND
Michael J. de la Merced, The New York Times, Wednesday 6th March 2019

Goldman Sachs told its employees on Tuesday that it planned to relax its dress code. In an internal memo, executives said they would adopt a ‘flexible’ dress code in keeping with the times. It’s the latest attempt by a Wall Street firm to cater to the young workers it tries to recruit. JP Morgan, a top competitor, made the leap to business casual nearly three years ago. “We want all of our clients to feel comfortable with and confident in our team, so please dress in a manner that is consistent with your clients’ expectations,” Goldman executives said in the memo. But efforts to embrace casual dress have been met with caution, as bankers fear being viewed as slackers for how they dress. Indeed, the memo itself urged some restraint. “Of course, casual dress is not appropriate every day and for every interaction,” they wrote in the memo. “We trust you will consistently exercise good judgment in this regard.”

To read the full story click here
Crisis in Democracy: Renewing Trust in America. The report of the Knight Commission on Trust, Media and Democracy ND
The Aspen Institute, February 2019

The Knight Commission report focuses on the intersection of distrust in American democratic institutions and in the journalistic media. Worthwhile for any professional interested in the current climate of distrust, this report finishes with ten recommendations for journalism, technology and citizens, on how democratic governance can best be preserved throughout difficult times.

Read the report
BHP looks to women and science in leadership shuffle ND
Luke Housego, Australian Financial Review, Thursday 28th February 2019

BHP has reshuffled its executive leadership team to include three more women and added roles focused on science and technology, a move the miner says will help position the business for the future. Geraldine Slattery, Laura Tyler, Vandita Pant and Jonathan Price were named on Thursday as incoming executives, taking female representation on the executive close to 50 per cent. The new roles are chief transformation officer and chief geoscientist. In a statement, BHP chief executive Andrew Mackenzie said science and technology would become a greater focus for management. "These management changes are an important step as we plan for the future of BHP. The elevation of geoscience and transformation to the executive leadership team demonstrates the determination we have to advance the best science, technology and people to make our operations safer and more productive," he said. The addition of three women to the executive leadership team pushes the company towards a 2016 target to have women make up half its workforce within nine years.

Click here for the full story
ASX governance council dumps ‘social licence to operate’ from guidance ND
Joanna Mather, Australian Financial Review, Thursday 28th February 2019

Following a furore over political correctness, the phrase ‘social licence to operate’ has been dumped from updated guidance by the ASX Corporate Governance Council. All references to the term have been replaced with ‘reputation’ and ‘standing in the community’ in the fourth edition of the council’s principles and recommendations on best practice for corporate governance. The council said it was concerned the phrase, which was included in an earlier consultation draft, would create problems for companies in the gaming, alcohol, tobacco, fast food and mining sectors. Australian Council of Superannuation Investors chief executive Louise Davidson said the updated guidance reflected the key concepts involved in having a social licence to operate but the phrase itself became a distraction. "It's a little bit of a puzzle to me to be honest as to why it was such a controversial and inflammatory issue," she said. "From an investor perspective we think it actually makes sense. But it became too much of a galvanising issue and started to take away from the key things that we were actually trying to achieve." The Business Council of Australia welcomed the final version, labelling it “measured” and “workable into the future”.

Click here for the full story
Japan antitrust probe to target Amazon, Rakuten and beyond ND
Kosuke Takeuchi and Junichi Sugihara, Nikkei Asian Review, Wednesday 27th February 2019

Japanese antitrust authorities are set to launch a probe into Amazon Japan, Rakuten and Yahoo Japan, who are suspected of forcing online vendors into shouldering an unfair burden in rewarding customers through loyalty programs, Nikkei Asian Review has reported. The Japanese Fair Trade Commission is investigating changes in Amazon Japan’s reward program taking effect in late May that would require vendors to shoulder the costs. Such arrangements, similarly found at Rakuten and Yahoo Japan, essentially cut into vendors’ revenue, adding to the fees they already pay to hosting platforms. The probe is part of a braod investigation into big tech companies launched by the regulator at the start of this year. With the influence gained by Amazon recently, the government is scrambling to find the right balance between encouraging growth and protecting smaller businesses. Tokyo is starting to consider concrete measures to regulate platform operators, including steps to prevent excessive concentration of data. A plan to tackle the issue will be incorporated into the government's growth strategy due out this summer.

To read the full story click here
Glencore moves to cap global coal output after investor pressure on climate change ND
Nassim Khadem, ABC News, Thursday 21st February 2019

Australia’s largest coalminer Glencore has announced it will cap its global coal output at 2019 levels, succumbing to shareholder pressure to take action to address climate change. “To deliver a strong investment case to our shareholders, we must invest in assets that will be resilient to regulatory, physical and operational risks related to climate change,” the company said in a statement. The Swiss-based resourcing giant also said it would examine its membership of trade associations to ensure those groups aligned with the Paris climate agreement and Paris goals. These associations include the Minerals Council of Australia. Director of climate and environment at the Australasian Centre for Corporate Responsibility (ACCR), Dan Gocher, said the move by Glencore debunked mining industry lobby groups' claims about the future of coal. "This announcement should bring to an end to the MCA's single-minded coal growth advocacy," he told the ABC.

To read the full story click here
The road to digital unfreedom: three painful truths about social media ND
Ronald J. Deibert, Journal of Democracy, January 2019

In this article, Ronald J. Deibert from the University of Toronto examines the state of big tech companies today. Describing Google as a ‘massive commercial surveillance system’, Deibert explains what he calls ‘three painful truths’ about social media. First, that the social-media business model is based on relentless surveillance of personal data to tailor advertisements. Second, that we permit this surveillance willingly if not wittingly. Third, that social media is not incompatible with authoritarianism, and in fact enables it in many cases. Deibert highlights the issues of social media in great detail, but ends on a hopeful note. “The tasks are enormous, yet we must avoid fatalistic resignation to the toxic world of personal-data surveillance,” he writes. “We need to imagine a better world and start making it happen, before it is too late.”

To read the article click here
You’ve committed to increasing gender diversity on your Board. Here’s how to make it happen. ND
Paula Loop & Paul DeNicola, Harvard Business Review, Monday 18th February 2019

There’s good news for diversity on boardrooms. The vast majority of corporate directors see value in including more women and minorities, with nearly 95 per cent of directors agreeing that diversity brings unique perspectives to the boardroom and 84 per cent believing it enhances board performance. What’s more, the number of directors who rate having female board members as ‘very important’ has nearly doubled since the last time the question was asked, rising from 25 per cent in 2012 to 46 per cent today. However, there are also signs of ‘diversity fatigue’, with just over half of directors saying they think diversity efforts are motivated by political correctness, and 48 per cent believing shareholders are too preoccupied with diversity. So where to from here? Five recommendations: review the benefits, understand that one isn’t enough, rethink director criteria, require a 50-50 slate, and expand the size of the board.

For the full details of this list click here
Australia’s biggest companies failing to plan for climate change risks: report ND
Nassim Khadem, ABC News, Monday 18th February 2019

Australia’s biggest companies are not heeding calls from regulators and investors to do more to mitigate climate change risks, according to a new report by environmental campaign group Market Forces. The report is based on public information from 72 big listed companies operating in sectors considered high-risk on climate change. It found that just above half identify climate change as a material business risk, and just 32 per cent disclose detailed discussions of specific climate change risks facing their business. Market Forces analyst Will Van de Pol said that despite increasing rhetoric from investors and regulators about climate change risks, there has been little progress to report. "Companies are willing to make general statements recognising climate change as a potential risk but very few have gone into the detail of how climate change risks might materialise for their business and what they are doing in response," he said. The Market Forces study follows a report by the Australian Securities and Investments Commission (ASIC) in September that found that out of 60 listed companies in a sample of the ASX 300, just 17 per cent identified climate risk as a material risk to their business. That review found in some cases "climate risk disclosures to be far too general, and of limited use to investors".

For the full story click here
Carsales boss blames banking royal commission for profit declaration ND
Jennifer Duke, The Sydney Morning Herald, Wednesday 13th February 2019

Carsales CEO Cameron McIntyre has blamed Australia’s banking royal commission for continued difficulties in the vehicle sales site’s financing division, though he expects “moderate” growth in the second half of 2019. For the first half of 2019, Carsales’ net profit was down 82 per cent to $11.1 million, which Mr McIntyre said was due to legislative changes affecting lending and the tighter credit market. The Australian Securities and Investment Commission (ASIC) banned ‘flex commissions’ in November, which used to allow car dealers and brokers to get bigger bonuses for getting customers signed up on higher interest rates. “As detailed in our market announcement in December, our Finance and Related Services business continues to be impacted by credit tightening as a result of the Financial Services Royal Commission and the recent ASIC legislative changes," Mr McIntyre said in a statement.

For the full story click here
The business of saving the planet ND
Sean Silverthorne, Harvard Business School, Monday 11th February 2019

As businesses are beginning to become fully engaged on the issue of climate change, professors at Harvard Business School in domains such as customer service, finance, operations, and business history are coming together to explore the many facets of how sustainability and business management might mix. At the link below, you can see a sample of that work, which features a background article, seven stories on the business of environmental sustainability, and five research papers.

To access these resources click here
Gucci and Adidas Apologise and Drop Products Called Racist ND
Tiffany Hsu & Elizabeth Paton, The New York Times, Thursday 7th February

Less than a week into Black History Month, Adidas and Gucci have apologised and pulled products criticized as racist. The Gucci item: an $890 black-knit women’s balaclava that could be pulled up over the lower half of a woman’s face, which included bright red lips ringing an opening for the mouth. This aspect was widely denounced on social media as evoking imagery of blackface. In Adidas’s case, the brand included an almost entirely white pair of shoes in a line of clothing and sneakers inspired by the Harlem renaissance movement and meant to commemorate Black History Month. Criticism of the designs spread quickly on Twitter, prompting the companies to act amid separate firestorms over the fashion industry’s pattern of racially offensive choices. Gucci released a statement on Twitter late Wednesday, saying it “deeply apologizes for the offense caused” by the balaclava’s design. “We consider diversity to be a fundamental value to be fully upheld, respected, and at the forefront of every decision we make,” the company said in the statement. “We are fully committed to increasing diversity throughout our organization and turning this incident into a powerful learning moment for the Gucci team and beyond.” Earlier that day, Adidas said it would pull the shoes at issue, part of the “Ultraboost Uncaged” line, from stores. The company said in a statement that the $180 sneakers “did not reflect the spirit or philosophy of how Adidas believes we should recognize and honor Black History Month.”

For the full story click here
2019 Edelman Trust Barometer ND
Edelman, January 2019

The 2019 Edelman Trust Barometer highlights some interesting shifts in global trust trends. ‘My Employer’ has emerged as the most trusted entity, as people-to-people relationships feel more controllable. The shift is also noticed in the context of a “mass-class” divide. Trust among the informed public moved to a high of 65 per cent, while the mass population continues to distrust institutions (49 per cent). Pessimism is widespread, with only one in five of the mass population respondents believing the system is working for them. Fears of job loss among the general population remain high, and more than twice as many of resoibdebts say innovation is too fast (54 per cent) versus those who say it is too slow (21 per cent). A desire for change can be seen through various social movements, from the Gilet Jaunes in France to #MeToo movement. And this is spreading to the consumption of news, up 22 points in a year to 72 per cent. Trust in traditional media and trust in search are now tied at 66 percent, their highest historical levels, while trust in social media is in crisis (43 percent).

For the full report click here or to read the Executive Summary click here
Facebook users continue to grow despite privacy scandals ND
BBC News, Thursday 31st January 2019

Despite a series of well publicised data privacy scandals, Facebook said the number of people who logged into its site at least once a month jumped nine per cent last year to 2.32 billion people. Founder Mark Zuckerberg said the firm had "fundamentally changed how we run the company to focus on the biggest social issues". The company's shares have lost almost a third of their value since July when it warned about slowing revenue growth and they remain near a two-year low. But they jumped over 9% in after-hours trading after profit and revenue beat analyst forecasts. Facebook's total profit for 2018 was $22.1bn (£16.9bn), up 39% on 2017.

To read the full story click here
A ‘black eye’ for Apple: Facetime bug shakes faith in iPhone security ND
Julia Carrie Wong, The Guardian, Wednesday 30th January 2019

It was a “nightmare scenario” for Apple this week as news emerged on Monday that a bug transmitted audio and video to a caller despite the recipient not having accepted the call. It was triggered when the initial caller added a third person to a FaceTime call. Apple, yet to issue a software patch, has disabled group chatting on FaceTime, preventing users from further exploiting the bug. A major issue for Apple has been its response to community expectations surrounding the action it should take – the Arizona attorney who found the bug began posting about it on Facebook and Twitter eight days before Apple took action.Katie Moussouris, the founder of Microsoft’s bug bounty program and CEO of Luta Security, said that the problem for Apple was not that it failed to act quickly enough to patch the bug, but that it failed to manage Thompson’s expectations of how quickly a bug can be patched. “It’s best not to rush,” Moussouris said. “You have to do in-depth investigations or else you can have unintended consequences. You don’t want people issuing patches that no one trusts or that break other things.” Marcus Carey, a cybersecurity expert, said that the case was a “black eye” for a company which has a strong reputation in security and privacy. “They’re going to have to be fully transparent on how this bug happened, and when it was introduced,” Carey said. “They need to release information about whether they can track to see if it was exploited, and they should notify customers.”

To read the full story click here
Companies can appeal to workers and consumers with liberal messages ND
The Economist, Thursday 24th January (Print Edition)

In an advertisement released in mid-January, Gillette, a razor company, achieved its 15 minutes of viral fame by taking a stand against ‘toxic masculinity’. Its gamble was that the free publicity that came from the controversy would offset any lost sales to men who were annoyed by the messaging of the ad. A similar bet worked for Nike last year when it used Colin Kaepernick – an American footballer who lost his job after kneeling during America’s national anthem in protest against police racism – in an advertising campaign. Some conservatives burned their Nike shoes in protest, but the company’s share price quickly rebounded and Nike’s sales rose as millennials showed they were more than happy to buy footwear that attracted the ire of President Donald Trump. “A younger generation of consumers is seeking products that are aligned with their causes,” says Renee Richardson Gosline of the mit Sloan school of management. Similarly, companies want to recruit workers from the same generation, which also means appealing to their values. “Young people don’t want to work for a company if it is seen as harmful to the environment or society,” says Jaideep Prabhu of Cambridge University’s Judge Business School. They want to be proud to say where they work. It is also worth remembering that firms have long been part of the political process through carefully co-ordinated, expensive lobbying campaigns. Last year, for example, eight firms including Alphabet (Google’s parent) and Amazon each spent over $10m lobbying America’s Congress, according to Opensecrets.org, a website. If firms can push a conservative, low-tax-and-regulation message, why not a socially progressive one?

For the full story visit this link
World leaders at Davos call for global rules on tech ND
Keith Bradsher & Katrin Bennhold, The New York Times, Wednesday 23rd January 2019

In a clear sign of growing international interest in regulating the tech industry, leaders of Japan, South Africa, China and Germany issued a series of calls on Wednesday for global oversight of the tech sector. Prime Minister Shinzo Abe of Japan said his country would use its chairmanship of the G20 to push forward a new international system for the oversight of how data is used. Data governance will be the theme when the group’s leaders gather in June in Osaka for the annual meeting. “I would like Osaka G20 to be long remembered as the summit that started worldwide data governance,” Mr Abe said in a speech at the World Economic Forum in Davos, Switzerland. The remarks were echoed by leaders speaking from South Africa, China and Germany, but did not seem to represent a coordinated effort to push forward a new international architecture for such oversight. Europe, and Germany in particular, have emerged as the de facto regulators of the technology sector, exerting influence beyond their own borders. Berlin’s digital crackdown on hate speech, which took effect last year, is being closely watched by other countries.

For the full story click here
Journalism, Media and Technology Trends and Predictions for 2019 ND
Nic Newman, Reuters Institute for the Study of Journalism, University of Oxford, January 2019

The Reuters Institute for the Study of Journalism’s predictions for 2019 are outlined in great detail in this report, which notes that 2019 will be a ‘critical year’ for publishers and platforms in terms of rebuilding trust and credibility. 2019, it writes, will be a year of fundamental shifts. The labelling and prioritising of trusted content as a means to counter misinformation is well underway. Likewise, organisations like the New York Times are working on the basis that every piece of content they make should be worth paying for. This underpins the changing business model of news media, which sees subscriptions and private foundations becoming more and more important as advertising revenue continues to fall. The report predicts that more news organisations will go to the wall as economic conditions worsen, and that artificial intelligence will open up many possibilities for the way news is told.
This report is recommended reading for corporate public affairs practitioners to better understand the changing media environment.

To download the report click here
Data, Analytics & AI: How Trust Delivers Value ND
MIT SMR Connections, Custom Research Report, January 2019

This report, by SAS in collaboration with the MIT Sloane Management Review, examines how to derive more value from analytics and emerging technologies like artificial intelligence. It presents a global survey of 2,400 business executives and managers to identify where recognised best practices are becoming mainstream and where they may still be exceptional. It found that respondents who have advanced their analytics practices to incorporate AI-based technologies such as machine learning and natural language processing work in organizations that do the most to foster data quality, safeguard data assets, and develop cultures of data literacy and innovation. A key finding was the gap between having data, and having the right data. And those executives who reported a higher level of trust in their data were more likely to have shown leadership in foundational activities that ensured the data was high quality. The research came to three main conclusions. First, better data governance is needed. Second, data privacy has emerged as an opportunity. And third, fostering an analytics culture improves innovation.

To download the full report click here
Google fined record €50m by French data protection watchdog ND
Alex Hern, The Guardian, Monday 21st January 2019

The French data protection watchdog has fined Google a record €50m for failing to provide users with transparent and understandable information on its data use policies. It marks the first time a company has been fined under new terms laid out in the European general data protection regulation (GDPR). The maximum fine for large companies under the new law is four per cent of annual turnover, meaning that Google could theoretically face a maximum fine of €4bn. The French watchdog (CNIL), said Google was fined because it made it too difficult for users to find essential information, “such as the data-processing purposes, the data storage periods or the categories of personal data uses for the ads personalisation”, by splitting them across multiple documents, help pages and settings screens. Such a lack of clarity meant that users were effectively unable to exercise their right to opt out of data-processing for personalisation of ads. In a statement, Google said: “People expect high standards of transparency and control from us. We’re deeply committed to meeting those expectations and the consent requirements of the GDPR. We’re studying the decision to determine our next steps.” Dr Lukasz Olejnik, an independent privacy researcher and adviser, said the ruling was the world’s largest data protection fine. “This is a milestone in privacy enforcement, and the history of privacy. The whole European Union should welcome the fine. It loudly announced the advent of GDPR decade,” he said.

For the full story click here
Sustainability reporting: a best practice ND
The Boston College Center for Corporate Citizenship, Fall Issue 2018

The reporting process and the resulting report has become essential for strategic decision-making, enabling stronger long-term planning, stakeholder relations, and data-driven insights. And as disclosure becomes more popular, reports become more sophisticated (and useful). According to the Boston College Center for Corporate Citizenship’s State of Corporate Citizenship 2017, executives appreciate the value of corporate citizenship reporting and are continuing to increase their investment in it. According to the report, more than 40 per cent of executives reported that their companies issued a report, and more than 65 per cent reported they plan to grow these investments. In addition to the business benefits, it is also fast becoming a legal requirement to report ESG metrics. In France, nonfinancial reporting requirements have been in place since 2015, and in Denmark, since 2009. Across the board, the clear trend is toward greater transparency in both financial and nonfinancial dimensions.

To read the full article from the BCCC’s magazine click here
Goldman boss apologises for 1MDB scandal ND
BBC News, Wednesday 16th January 2019

The new boss of Goldman Sachs has apologised to Malaysia for the role an ex-partner played in the corruption scandal at one of the country’s wealth funds. CEO David Solomon also distanced the bank from the scheme, which saw billions of dollars embezzled from the state development fund, 1MDB. Goldman had helped raise money for the fund, and Mr Solomon said the bank had been deceived about details of the deals. Malaysia filed criminal charges against Goldman last month. Although the scandal has hurt the bank’s reputation, Mr Solomon said the overall impact on client relationships had been minimal. “This has been a difficult time, but I’m proud about how our firm has remained focused on our clients,” he said. According to authorities, Goldman earned $600m for its work underwriting more than $6bn in bonds between 2012 and 2013 for 1MDB. Much of the money meant for the fund was then allegedly embezzled, used to buy art, property, and a private jet among other things. Malaysia’s former prime minister Najib Razak is among those who have been accused of pocketing the money – a charge which he denies. That case is scheduled for trial in Malaysia later this year.

For the full story click here
Gillette faces backlash and boycott over ‘#MeToo advert’ ND
Michael Baggs, BBC News, Tuesday 15th January 2019

A Gillette advertisement which references bullying, the #MeToo movement and toxic masculinity has split opnion online. The company’s short film plays on their famous slogan ‘the best a man can get’, replacing it with ‘the best men can be’. And while some have praised the message of the advert, others have declared they will boycott the razor brand. The ad has garnered more than nine million views on YouTube, with more than 500,000 ‘dislikes’ compared to 125,000 ‘likes’. Comments on the video are largely negative, with one angry viewer writing that ‘in less than two minutes you managed to alienate your biggest sales group for your products.’ But the brand believes the new advertisement aligns with its slogan and says it believes in ‘the best of men’. "By holding each other accountable, eliminating excuses for bad behaviour, and supporting a new generation working toward their personal 'best,' we can help create positive change that will matter for years to come," says its president, Gary Coombe. Rob Saunders, an account manager for UK advertising company the Media Agency Group, told the BBC that there was no need for widespread panic at Gillette just yet. "Their ad is getting them good publicity and good numbers and causing a debate - which they must have known when they put out this ad… This ad would have been approved by many people high up at Gillette,” he said.

For the full story click here